digital music and the music business

Why Are We Still Debating Free?

On Friday morning I dashed off a Daily DIY "Understanding The Value Of Free" which urged indie artists to remember the power of sometimes giving their music away and included a year old clip of Wired's Chris Andersen whose book on "Free" comes out in July. Almost instantly, a flurry of comments began that keep on coming.

Why are we still debating free?

I invite you to join the debate, but I'm actually amazed that we're still having this conversation. Free has happened. I suppose that you could wish that it didn't happen, but it did. Fighting it is pointless. Just look at the damaging whack-a-mole strategy of the major labels.

As one of my favorite music industry thinker's Andrew Dubber of New Music Strategiescommented, "Yes,
Google gives their consumer-facing stuff away, and they are a massively
successful company. That doesn't mean that if you give your
consumer-facing stuff away you will also necessarily be as successful
as Google. But if you try and charge by the transaction in that
environment, you will necessarily fail, because this is just how things
are now."

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The debate rages because there is patently another way. Rather than take a polarised stance, "free" alone need not necessarily be the answer. Independent musicians can de-anchor their position from impecunity. "Free" is practically the preserve of only either Google-type megaliths or vanity projects without a business plan. I feel the leading exponent of the ability to earn a crust, despite innumerable 'free' alternatives, is Jason Fried, CEO of 5-yr old 37 Signals, who's flagship product (www.basecamphq.com) undeniably demonstrates money can be made ... admittedly, the snag remains for each individual artist the precise issue of "how exactly?"

I feel like you've missed my point, Harrison - and Anderson's too. Free is not a business model, it's a strategy. If ALL you do is give things away for free, then of course you're going to experience difficulties.

Similar difficulties, in fact, to those you'd experience if you refuse to give things away for free at all.

For the record - I pay money to Basecamp every month, and one of the reasons I do is because their product is free. That's not their business model - it's the strategy that makes their business model work in the current environment.

But what makes it work (and what often gets forgotten in this discussion) is that Basecamp is both free and magnificent.

The trouble each individual artist has is that they now have to be free AND they have to be great. Doesn't matter how much free stuff you give away, it's going to be an uphill struggle if your music's mediocre...

Bruce - for the record in my posts in the other thread, i said i agree with free, but within a proper retail framework. what i disagree with is the notion of free without the ability to purchase immedaiately wither via a store checkout or a buy link. Free without that is a waste (especially for any unknown or marginally known band)

Bottom line is that Mr Anderson & Mr Dubber are being a bit disingenuous in how they toss the word FREE around. There's a whole other sub text they are not adressing which has to do with copyright laws and the doing away with publishing statutory rates because they are too restrictive for web innovation. This is will almost certainly lead to taking money out of the pockets of musicians which i strongly disagree with.

So I'm not arguing against free, I am arguing against the sub text that Mr anderson & Mr Dubber (and also Mr Lessig & followers) are not addressing here, which namely is the doing away of copyrights under the guise for web innovation. That innovation is much more important than proper compensation for content. Paying musicians and other content makers properly is THE biggest battle we have in the industry today. It's costs money to make conetent. Bruce, you of all people should recognize this.

And as far Mr anderson giving away his book, i figured he would, he HAS to if he really beleives his own teachings. the only difference is that he already has a name, ala NIN & Radiohead, so giving it away only adds to his cache, but it certainly doesn't support him or his family. His job at Wired does that.

For the record, my motto for the last 4 years or so has been "free sells". just as long as you give it away correctly (smartly).

@Andrew Dubber
Carefully reading your considered points, I fancy we pretty much huddle around a similar viewpoint, Andrew.

Yes, we could debate the nuances of definition that distinguish 'business models' and 'strategies' over some of that wonderful whisky I recall you blog about, yet the fact remains that independent artists today (whilst in the main acknowledging that they must provide gifts) are struggling primarily with how the freebies encourage progression through the much-vaunted 'customer funnel' towards putting food on the table.

As for basecamp, it's interesting to note the reason you cite for adoption (and paying) is that they do provide a free version. My experience is that their free (single project) option is about as useful as a 30 second 64bit mp3 of your latest recording. The users I know pay each month in part becuase they love the attitude. Where this quite leaves independent musicians, well, I don't know. I wish I had the answers but hats off to you and Bruce for stimulating plenty of thoughts on the journey towards them
:-)

Really is that all of us in any knowledge industry compete with free. The best example of a band that gets it is Arctic Monkeys. They started by performing a lot! As they grew their fan base & allowed uploads of their content to myspace, et al (& apparently they had no idea): the fans reciprocated with huge demand. They broke the Oasis 1st week sales record in the UK & outsold the next 20-39 in the top 40 - combined - 370k units if memory serves. But, the issue that misunderstood is that only 0.03% of releases account for over 50-60% of troy revenues. That's about 30-50 albums (this is US market specific), but everyone cannot expect these odds to differ for them. It is this extreme that has always made the long tail argument absurd. The fans who already buy most of the music are far more likely to want access to the whole tail. But, attribution & proper double-entry accounting across all channels needs to be transparent as we also see shrinking windows to convert into "sales". Paparrazzi effect & the need to capture willing payers in real time is truly what versioning & talent is about. Success may not come to all but more folks should think of their fans as patrons & include them in a community - call it vanity but it works. It's great to be a rock star but if we knew the hits we would not need IP or even fancy explanations - just take orders!

"That innovation is much more important than proper compensation for content."

I will always have a difficult time wrapping my head around an artist, and not a business man, ever maintaining this position. I get Disney jumping on that band wagon, but I don't get independent artists falling in line. The purpose of copyright laws was to encourage innovation through compensation. Copyright laws were not made to honor people's right to ownership of their ideas, that is just a side effect.

Lessig's point is that people are going to download, remix, etc, one way or the other. Which means kids downloading music illegally means they are coming to terms with the fact that they are doing things that are illegal, and accepting that as not morally improper. This is simply bad for culture all a round.

So we are at a cross roads where the original purpose of copyright (to encourage innovation) no longer requires copyright. People will innovate without it because cost of production is faster and faster approaching zero. Anyone with a great idea and time to learn can innovate and create brilliant work.

Even still, this is all taking the original argument out of context. What Bruce and everyone else is arguing is that the free debate is over. You either figure out a way to make it work or get left behind. I don't think any one is saying you can't also sell music in some capacity, but simply that giving music away is going to be critical and necessary. As I've mentioned, I give away all of my music and still make money. I have a long term business plan and am running in the green financially. And my music is in a very, very tight niche.

I agree that free is a strategy and not a business model. Artists need to think of themselves as a brandable product. The music they create is just a piece of media to signal the consumer of one's existence. I see it like advertising. Build up the name and brand using various forms of media and then extract value from the consumer through calls to action (buy swag, events, even online 'tip-jars').

Then there is the whole idea of iterative development. What if artists adopted the open source movements mantra of 'release early, release often?' They get much close to their audience and receive feedback.

Bruce, the debate with 'free' is that it is being applied blindly to all manner of distribution, whether it benefits the artist or not. There are many cases where there is intrinsic value in the music product in one format or other and it can be monetized at a fair price.
In other cases, the "music should be free" mantra is being disingenuously propagated and misappropriated by those who own platforms to drive traffic to their other properties - we see this happening in China a lot for example - whilst the artists and copyright owners earn little revenue within the parameters of their relationship with the primary free music distribution platforms.
Just as terrestrial TV/ radio co-exists with cable/ satellite TV and radio, in the same way, free music can co-exist with paid but the challenge is in drawing the lines.

No! lets compete with "free" by offering a better consumer focused solution at a fair price. If Itunes' variable pricing was set at 20, 30 and 50p a lot more people would buy a lot more music. Even better... how about if Sky partnered with Limewire and turned it into a supreme user-focused app for say £8 a month? (after all they know how to deliver main stream consumer-focused solutions that work).

Piracy will always be around and to a certain extend it's great for spreading the word. It's when the mainstream opt-in to piracy that we have a problem - and that's largely to do with the lack of innovation within the recorded music business.

Lower the price, create exiting consumer focused solutions that deliver music seamlessly where, when and how people want it and they will happily pay for it.

Still waiting for my free guitar to come in the post...should I give up on that? Am I reaching here? :)

The only reason we're discussing free is because of panic and herd mentality...artists afraid they won't get anywhere without giving everything away. I don't think this debate is near being done. The bottom line is that free will never work; there is a real world out there with real expenses; food, transportation, housing...that won't be given away anytime soon.

I'm tired of hearing about NIN and Radiohead...its so far from being a typical situation in the music biz as a whole; hugely popular bands with massive audiences that can afford to experiment like that with any success. The problem is that it distorts listener reality for 99% of every other working artist or band, who are just scraping by.

which is why we are redesigning our site to accommodate a donation download system. So people have the choice to pay us. We are actively forgoing people who don't want to support music financially.

But you are right about my generalization.. I should have been more specific....I was referring to the mass market ML idea that you must sand blast money out of consumers before they have a chance to believe in what they are buying. That is fail and starfuckish. Do you agree?

Thanks for explaining wheatus; yes I'm most certainly in agreement with your sentiment on the major labels. Much of this present situation has been a direct result of their greed, mismanagement and abuse of the fan. It's easier than ever for an artist to leave the corporate crap behind, and I think that's an amazing thing.

If the corporate, big business mentality of the industry was the only thing to go away, I don't think that would be a bad thing. The industry has had great independent scenes for years and years, that encompass all the best things that music can be to artists and fans, minus the greed. But those scenes were still dependent on the fans support buying records and attending shows. With the death of our traditional models, this will go away as well...and that sucks.

There isn't anything inherently wrong with free. What you are doing is great; it's your right as a creator. It's very generous of you; a gift.

Unfortunately, with our culture becoming more and more expectant of having everything given to them for free, the generous gesture of the artist, freely sharing their art loses all meaning, and I think that art IS meaningful and worthy of being considered more than just a brochure or loss leader.